UK retail sales volumes beat analysts’ expectations in July but still revealed a slowdown as consumer demand continues to wane.
According to the Office for National Statistics (ONS), retail sales volumes grew by 0.3 per cent month-on-month. This is just above economist‘s expectations of a 0.2 per cent rise.
In the three months to July, sale growth fell to 0.6 per cent, compared to a 1.5 per cent increase in the three months to June – the strongest quarter since last year.
Food was once against the strongest sector, helping to offset the decline of every other sector except household goods.
Meanwhile, online sales jumped by 15 per cent compared to July last year, staying flat on Junes growth levels. This equated to roughly 16 per cent of all retail spend.
“The underlying trend at the beginning of 2017 showed a relatively subdued picture for retail sales,” ONS statistician Ole Black said.
“Whilst the overall growth (in July) is the same as in June, trends in growth in different sectors are proving quite volatile.”
This comes after news that inflation remained flat in July at 2.6 per cent, marking an improvement on economist predictions of a 2.7 per cent rise.
“The UK consumer is extraordinarily resilient,” Hargreaves Lansdown‘s senior economist Ben Brettell said.
“Spending has defied expectations of a slowdown since the Brexit referendum, and currently seems to be holding up despite weak wage growth and above-target inflation.
“This could bode well for economic growth – the UK economy is heavily reliant on the consumer, and economists had expected falling real incomes to eventually translate into weak retail sales.”